In my former years as a student studying China’s impact on security within the Asia-Pacific region, we were told never to underestimate the security risk separated by the Taiwan Straits. The Straits receive far less media coverage than many other contentious areas of the world, making it easy to forget the deep-rooted hegemonic disputes between China and Taiwan.  The ‘One China Policy’ that includes Taiwan as part of the motherland, is an entrenched belief held among both China’s government and the people. In contrast, Taiwan denies such sovereignty of its borders, seeing itself as an independent state. You do not need to look far for reminders that China and Taiwan see their identities very differently. While I was in Shanghai airport last year, as expected, Taiwan was classed with other domestic destinations. When teaching Taiwanese and Mainland Chinese Students, tension soon surface with the Taiwanese claiming they come from a separate country and their peers insisting they are all from China!

Until now the US has used diplomacy to engage with the Chinese communist party. In doing so, successive American presidents have averted significant security risks within the Asia-Pacific region and maybe even the world. All of this has changed since Donald Trump won the 2016 American election. Donald Trump, against the advice of the Pentagon, directly contacted Tsai Ing-wen, Taiwan’s pro-independent President. So far, China’s predicted rage would appear to have been averted with Beijing doing little more than publicizing their disapproval. However, culturally, China plays by very different rules to those favoured in countries such as the United States. China is well aware that combat comes at great expense. According to Forbes, The War on Terror has so far cost America $1.7 trillion.  It is little wonder that China would rather spend its capital on continuing to raise the living standards of its people than going to war. However, it would be a mistake to believe that China will ignore the President-elect’s actions. China is far more likely to choose a strategic course of action that offers the comfort of ‘saving face’ but still causing immense damage to their adversary. In 2004 Zhou Xiaochuan, governor of the People’s Bank of China, cancelled a trip to Singapore due to the Island state’s deputy minister’s visit to Taiwan. The aftermath left commercial relations between China and Singapore strained for some time. China’s reactions to Donald Trump’s conversation with the Taiwanese President could be far graver with far reaching consequences. For a start, President-elect Trump needs to consider that China holds vast numbers of US dollar treasuries and foreign currency reserves. One strategy that China may wish to adopt is to sell these reserves which are likely to deflate the US dollar.

In addition to threatening not to honour the ‘One China policy’, Trump has also targeted China by promising to place up to 45% tariffs on their imports (please see Cultural Chameleon’s last blog). Moreover, last week, Rex Tillerson, Trump’s proposed secretary of state, warned China that the US intended to block their access to the contested Spratly islands in the South China Sea. This has not only angered the Chinese government, ex Australian Prime Minister, Paul Keating, described Tillerson’s remarks as ludicrous. Furthermore, the English language newspaper the ‘China Daily’ stated that the US’s proposed plans to block China’s access to the islands as ‘unrealistic political fantasies that should not be taken seriously.’

We can only hope that once in office, Trump takes a new tack regarding his communication with China. Currently, it would appear that Trump is determined to make a foe of China. The highly acclaimed Chinese book ‘The Art of War’ written in the 5th century BC by Sun Tzu states:

Direct quote

‘If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle’. p.82

All we can now do is wait to see how well Mr Trump knows China. In contrast, China has a strong track record of outwitting its rivals. Sadly any war, trade or otherwise, between such superpowers will have dire consequences for the rest of us. So once again all we can hope for is that a different, more diplomatic Mr Trump emerges as president, ending the current dangerous liaisons between America and China.